Tax Incentives
A surge in home battery storage in recent years reflects growing homeowner concerns over escalating electricity prices and frequent power outages, which are resulting in a nationwide rush for greater energy resiliency and autonomy.
However, whole-home battery systems still carry relatively high upfront price tags and pose a significant barrier to homeowners. This is why financial incentives at the federal, state, and utility levels play a critical role in making home energy storage viable and affordable.
In this guide, we’ll break down the top 10 states in 2025 for battery storage incentives, highlighting where immediate savings and recurring revenue opportunities overlap to offer the strongest financial reward.
Overview of Home Battery Incentives in the U.S. (2025)
Federal Investment Tax Credit (ITC)
- Covers 30% of the cost of qualified home battery storage systems (standalone or paired with solar) available until December 31, 2025
- No maximum dollar limit, but credit is non-refundable (can be carried forward if it exceeds tax liability)
- Can be stacked with state, local, or utility incentives
State-Level Incentives
- Cash Rebate Paid per kWh or per kW of installed battery capacity
- Performance-Based Utility Programs Homeowners get recurring payments by participating in virtual power plant (VPP programs and contributing their stored power to support the local grid during peak demand periods. Some VPPs may offer upfront cost reductions or rebates as part of the enrollment.
- Net Metering Credits Battery owners can shift charging to off-peak hours and receive higher value for exports during high-demand periods.
- Tax Credits & Sales Tax Exemptions Some states offer direct tax credits, such as MD’s 30% energy storage income tax credit capped at $5,000
- Equity-Based Programs High incentive rates for low-income or high-risk communities (e.g., CA SGIP Equity & Equity Resiliency tier: $850 to $1,000/kWh, reducing cost to near-zero).
Top 10 U.S. States
with the Best Home Battery Incentives in 2025
- California
- New York
- Massachusetts
- Vermont
- Hawaii
- Texas
- Oregon
- Connecticut
- Colorado
- Carolinas
SGIP Battery Rebates
California’s Self-Generation Incentive Program (SGIP) offers per-kWh rebates where general residential rebates are around $150/kWh for small systems and $250/kWh for larger systems.
Demand Side Grid Support (DSGS) Program
Running from May 1 to October 31 each year, the DSGS program is an innovative capacity-based initiative that generously compensates homeowners for using their battery storage systems to ease grid stress.
Equity and Equity Resiliency Rates
The Equity Tier offers up to $850/kWh for eligible low-income customers (around 85% of system cost) and the Equity Resiliency Tier provides up to $1,000/kWh for medically vulnerable households or those experiencing wildfire threats and PSPS outages, often making battery storage nearly free.
New 2025 Residential Solar & Storage Equity Initiative
Starting June 2, 2025, California will offer a new statewide equity-based incentive of $1,100/kWh for battery, plus $3, 100/kW for solar installations.
Stackability with Federal and Local Rebate Programs
SGIP rebates can be combined with the 30% federal Residential Clean Energy Credit, and other local rebate programs, such as 3CE’s Residential Battery Rebate in Central Coast and LADWP rebates in Los Angeles.
NYSERDA Battery Rebates
New York’s NYSERDA program offers $200/kWh in upfront rebates for residential battery storage systems statewide (up to 25 kWh).
Long Island-Specific Incentives
These incentives include higher rebates funded by NYSERDA and RGGI (around $200-$400/kWh) through PSEG Long Island and related programs.
ConnectedSolutions VPP
Participating customers earn $275/kW average summer performance, paid annually by National Grid, Eversource, or Cape Light Compact. A 10 kW battery system can earn up to $2,750 per year, locked in for the first five summers.
Zero-Interest HEAT Loan Financing
Eligible homeowners can access a 0% loan up to $25,000 for battery installation (must enroll in ConnectedSolutions).
Mass Save Paired with Solar Initiatives
Mass Save promotes solar plus battery integration through energy assessment referrals and support services. It offers sales and property tax exemptions, plus a state income tax credit of up to 15% of system cost (max $1,000).
Green Mountain Power BYOD (Bring Your Own Device) VPP Program
Homeowners who enroll their battery agree to allow Green Mountain Power, Vermont’s leading utility, to have limited access to stored energy during peak demand events, typically 5-8 times per month for 3-6 hours at a time.
In return, GMP pays an upfront incentive of up to $950 per kilowatt (kW) of usable battery power, depending on the selected discharge duration, with an additional $1,000 bonus available for systems retrofitted with solar in grid-constrained areas.
Green Mountain Power’s (GMP) Resiliency Program
GMP’s Resiliency program in Vermont uses battery storage and local microgrids to keep power on during outages. Homeowners can enjoy significantly discounted or low-cost home battery storage with the requirement to enroll in an energy-sharing network.
Bring Your Own Device Plus (BYOD Plus) VPP Program
The new Bring Your Own Device Plus (BYOD Plus) program offers strong financial incentives. Under BYOD Plus, participants receive an upfront payment of $400 per kilowatt (kW) of committed battery capacity, or $800/kW for low-to-moderate income (LMI) households.
Additionally, homeowners also receive monthly bill credits at the full retail electricity rate for exporting stored energy to the grid during a selected two-hour window, typically in the early evening.
Local Utility Incentive from CPS Energy (San Antonio)
While CPS Energy doesn’t currently offer direct battery rebates, its Battery Rewards Program provides $10 bill credits per event-based discharge, paying customers to help stabilize the grid during emergencies.
REP-Based Incentives for Home Batteries
In Texas’s deregulated electricity market, Retail Electric Providers (REPS) offer unique programs to help homeowners offset battery installation costs and even earn credits. Reliant, a major Retail Electric Provider (REP) in Texas, offers the unique Octo GridBoost program. Participants receive a $40 monthly bill credit for enrolling and letting their home batteries be controlled to support the grid under the program. They can also earn real-time energy credits by getting paid at market rates for actively exported energy, with no cap.
Solar Within Reach Program
While the original Oregon Solar + Storage Rebate Program has paused new general funding, for low/moderate income households, the Solar Within Reach initiative continues to offer even greater support. These customers may qualify for rebates of $750-$900 per kWh, totaling up to $9,000 or more for a typical battery setup.
The Energy Trust of Oregon
Starting in 2025, the Energy Trust of Oregon, which serves Portland General Electric and Pacific Power customers, will offer attractive battery storage incentives, including upfront rebates of $475 per kWh, capped at $5,700 per project.
Wattsmart Battery Program
The Wattsmart Battery Program, offered by Pacific Power in Oregon, provides homeowners with an attractive mix of upfront incentives and future bill credits. Participants receive a one-time rebate of $600 per kilowatt, capped at $3,000 per battery and limited to two batteries per household, along with an annual credit of $15 per kilowatt beginning in the second year.
Energy Storage Solutions (ESS) Program
Under ESS, homeowners may receive $250 per kWh of usable battery capacity, capped at $16,000 or 50% of the system cost, whichever is lower. Households in underserved communities qualify for higher rebates of $450 per kWh, while low-income households can access $600 per kWh.
Homeowners enrolled in the program can also earn performance-based incentives by allowing their battery systems to discharge power during peak grid demand periods, receiving up to $225 per kW per year for scheduled discharges in summer, with reduced rates in subsequent years and additional credits during winter events.
Xcel Energy’s Renewable Battery Connect Program
The program offers Colorado homeowners who install home battery storage a substantial incentive of up to $5,000 upfront at $350 per kilowatt (kW) of continuous discharge capacity. Participants also receive a $100 annual bill credit for five years, totaling an additional $500, for allowing Xcel to control 60% of their battery reserve during grid peak events.
Duke Energy’s PowerPair and Battery Program
The program offers homeowners who install a new solar-plus-battery system a compelling incentive of up to $9,000 in upfront rebates, comprised of approximately $3,600 for solar and $5,400 for battery storage. Homeowners can also choose to allow Duke to dispatch their battery up to 36 times annually, in exchange for ongoing monthly bill credits of roughly $6.50 per kW.
